Walkability premium: evidence for low-income communities

Abstract

Walkable neighborhoods are known for bringing social and economic benefits to their residents. One of these benefits is the real estate premium associated with the neighborhood's walkability, which has been explored in studies worldwide. Here, we extend the available evidence by proposing the evaluation of the walkability premium in a new context. We use multigroup structural equation models to evaluate the direct and indirect effects on low-income neighborhoods in two Brazilian metropolitan cities, São Paulo and Rio de Janeiro. The walkability perception is modeled, mediating the impact of the built urban environment elements on real estate pricing. The results confirm that we can expect a premium for walkability investments, even in poor neighborhoods under non-ideal conditions for walking, and this result is invariant between cities. The effects of the built environment on the real estate price are mediated by latent perceptions, showing the importance of incorporating subjective measures when assessing the walkability premium. Additionally, Latin American cities' socioeconomic and environmental conditions provide new interpretations of the studied phenomenon, highlighting the importance of considering the local context.